Indore-based Shop Kirana E Trading Pvt. Ltd, which runs business-to-business (B2B) platform ShopKirana connecting individual retailers with suppliers, has raised a pre-Series A funding round from Japanese seed-stage investment firm Incubate Fund, it said in a statement.
Mumbai-based Lead Angels Group and senior executives of top FMCG companies also participated in the funding round.
So far, Incubate Fund has invested in more than 200 startups in Japan and Southeast Asia. ShopKirana is its first investment in India.
The deal amount is Rs 2-3 crore, according to a report by The Economic Times.
"The grocery market in India is mostly supported by small businesses like kirana stores. This market is huge but highly fragmented and still inefficient. We believe ShopKirana would bring efficiency and sophistication to this market by supporting small retailers using technology," said Nao Murakami from Incubate Fund.
The startup plans to make significant investments in product and technology with this round of financing, ShopKirana's co-founder Sumit Ghorawat said.
Earlier this year, the company raised an undisclosed amount in funding from Atul Jain, former senior vice president of Samsung global headquarters; food tech startup Hola Chef's founder Anil Gelra; Jaikumar Nair, former senior vice president of Mondelez; and a few other veterans from the FMCG industry.
Founded in February 2015 by Ghorawat, Tanutejas Saraswat, and Deepak Dhanotiya, ShopKirana is an app-based platform which integrates the demands of thousands of retailers and passes them on to brands, thereby ensuring competitive prices and a single sourcing channel for retailers. In turn, brands get to directly connect with retailers for promotions or product launch. The supply chain innovation startup provides value-added services like logistics, banking, loan, IT and ordering systems to the retailers.
The startup claims to have over 5,000 kirana stores in Indore and Mumbai in its network. It also claims to process over 200 orders a day and handle sales of over Rs 10 lakh a day. Brands associated with ShopKirana include P&G, Hindustan Unilever Ltd and ITC, among others. ShopKirana aims to connect with over 1 lakh retailers in two years.
ShopKirana competes with Just Buy Live Enterprise Pvt. Ltd, an e-distributor that connects shopkeepers with consumer brands and distributors.
Just Buy Live, which is present in Mumbai and National Capital Region, is also looking to raise $30-50 million in its second round of funding to expand market presence. It aims to roll out operations in other geographies such as Gujarat, Rajasthan, Madhya Pradesh and Chhattisgarh. The one-year-old firm raised $20 million (around Rs 136 crore) in Series A funding from Alpha Capital in January 2016.